Cloud computing has been called as the future of computing, where resources, information and applications are managed virtually. The term “cloud” is used to represent the nature of imaginary cluster of information, where all information, resources and applications are stored. Not only we store data in the cloud, we can also take advantage of immense computing power and application in the cloud. It means, cloud-based computers will have only minimal hardware specs and excellent connectivity options. They don’t need powerful specs and large internal storage to store and run applications.

Cloud computing involves the use of virtual hosted environments that allow us to better connected with a variety of online services. As an example, with Google Apps, it is possible for users to gain data backup, lower IT costs, enhanced security and increased overall productivity. Microsoft has a strong presence in the cloud environment by adding its popular software solutions, such as the Microsoft Word and Outlook for cloud-based document processing and email management.

Many hosting companies have offered high performance cloud-based services. As an example, Rackspace already offers cloud hosting for people who want to establish personal or small-business cloud applications. These cloud hosting companies deliver easy setup and establishment of cloud hosting through the use of simple user interface. Instead of flat rate pricing, many cloud hosting companies user usage pricing. Users could pay based on the storage, bandwidth and processing power. The flexible pricing should benefit both end users and cloud hosting companies.

There are three types of cloud computing

Infrastructure as a Service (IaaS)

This method involves the use of expensive outsourced equipments. Companies don’t need to purchase high-cost equipments, such as networking equipments, hard drives and servers. These equipments are available from providers over the cloud. Users could use these virtual equipments at specific pricing.

Platform as a Service (PaaS)

Applications will be operated virtually in cloud servers. A small developer could sell their cloud applications and run them on the cloud. After paying for initial rights for using the cloud apps, users also need to pay based on resources-usage based.

Software as a Service (SaaS)

In this case, cloud applications are not sold in bulk licenses and paid only based on per-use basis. In this case, users could buy ala carte licenses for applications that they use occasionally. They only need to pay when the software is used and don’t own the cloud-copy of the software.

Cloud computing also has some disadvantages, especially if they are storing important data. Users may host their calendars, documents, email, multimedia and software in the cloud. Access could be unavailable if the hosting company experience a downtime. In fact, the major service provider, Google, was unable to provide access to Gmail and Google Apps for a few times due to technical issues. Confidence in cloud computing is often hindered by the fact that the data and software isn’t available in local machines. As a result, unexpected things could happen.